Month: February 2012

BOB DAHMS – COURTESY TO THE BELLINGHAM HERALD

Question: I’m hearing a lot lately about how some businesses are going “lean.” Is this a fad of some kind, or a real thing? And what should I know about it?
Answer: Yes, you certainly do need to know about Lean (in this context it’s normally spelled with a capital L). And you asked the right guy, I’m a huge Lean proponent. Let’s talk about this.
Lean is definitely not a fad, or just the latest cool business technique-of-the-month. It’s a whole different way of thinking about how you run your business. Once you “get it,” you won’t go back.

Question: In last week’s column you discussed how some companies are adopting Lean operating principles. I liked the basics. What more should I know about this?

Answer: Yes, the Lean operating model is expanding into successful businesses of every type. But realize, it’s not a short-term fad or a marketing gimmick. It’s a fundamental conversion of the culture within your company. Let’s talk about this.

In that column we discussed some basics of Lean, and also that many very successful companies, large and small, have adopted this business model. In brief, a Lean business focuses on continuous improvement by identifying waste, and eliminating it.

It’s an incremental process that can start small and then notch forward. It takes commitment from everybody. And it’s fun!

In this column we’ll focus on Lean techniques, some nuts-and-bolts issues, and whether Lean may be right for you. First off: to eliminate waste, you must know how to identify it. Waste is any expenditure of effort or resources that doesn’t add value (this is defined by your customer).

The original Lean model was based on manufacturing firms, but the Lean principles have been generalized into nearly every type of business, including service firms and even governmental agencies. Here’s a quick overview of some examples of waste:
 
Over-production. This is the making of whatever your end product is (finished products; architectural drawings; financial planning documents; floral arrangements) in greater amounts or complexity than is actually valued by your client.

Transportation. Your customers pay only for value-added processes—they don’t pay anyone to move parts around from one production line to another, or documents from one office to another. Some transportation is of course necessary, but it should be minimized.

Waiting and idle time. Waste occurs when employees can’t perform value-added work because they have to wait for incoming information or materials, or when they are tied to a workflow process that has excessive wait-time built into it.

Excess motion. Work processes should be designed so that employees don’t have to reach or walk around to get the supplies, tools, or data that they need. Unnecessary motion adds no value.

Rework. This expensive waste occurs when any work-product (goods or services) has to be redone or repaired due to errors or defects. The best thinking on this is simple: Minimize your “fix-it factory.”

Intellectual underuse. This waste refers to the missed opportunity of not using your employees’ skills to their fullest. It’s an invisible waste, because you won’t know about it unless you ask.

Our discussion of Lean business operations has to include one major local example. Paul Akers founded FastCap in Bellingham in 1997. After the business was up and running, he started a Lean transformation. This included several trips to Japan to see it firsthand, and to learn from the masters. He recently wrote a book on the transformation of FastCap into a Lean company. The book is called “2 Second Lean” and it’s a fun read. It gives you some feeling of how easy it is to adopt Lean into your life and your business, in very small increments, as the title suggests.

If you’re thinking about going Lean, you should do some research and then actually see it firsthand. Suggestion: when you’re ready, contact Akers at FastCap and ask if he has a tour of their facility available. It’s a real eye-opener.

But one caution here: realize that not every business is a candidate for Lean implementation. If done for the wrong reasons, or improperly, or if some employees resist change and would be holdouts (“anchor draggers”), you would definitely have problems. Get good advice before you commit.

Some sources for more information:
Visit lean.org for loads of good ideas and links.
Check the FastCap (fastcap.com) and the American Innovator (americaninnovator.com) websites. Both have very good videos, and also the audios of informative shows on Lean topics. They’re fun and easy to watch.
The three “Idiot’s Guide” and “For Dummies” and “Demystified” book series all have good offerings on Lean. Check the library around call number 658.
Search Google for “lean business principles” and see what fits your interests.
Keep an eye on other local Lean businesses. Examples: Samson Rope; McNett; Wood Stone.
Sustainable Connections, at their Future of Business Conference this April 27, is offering two breakout sessions on Lean. Check: sustainableconnections.org/bizdev/conference.
Five names to Google for blogs and other information: Mark Graban; James P. Womak; Jay Arthur; Jeffrey Liker; Eric Ries.

And, next time you’re in a Subway, watch the value-added production of your sandwich, from order to checkout.